NBCUNIVERSAL MEDIA, LLC v. WALKER

NBCUniversal missed a deadline to answer a garnishment notice tied to a lawsuit against someone named Hevekiah Walker, and as a result a default judgment of more than $500,000 was entered against it, even though NBCUniversal says it would have owed under $1,000 if it had answered on time. NBCUniversal asked the trial court to set aside that judgment, arguing that Georgia's garnishment default law violates due process and the Georgia Constitution's ban on excessive fines. The trial court denied the request in a short order without explaining its reasoning. NBCUniversal then asked the Supreme Court of Georgia to hear the case, since only that court can decide cases where a law's constitutionality is challenged. But the Supreme Court found that the trial court's brief order could have been based on a separate legal issue, not the constitutional question, so there was no clear ruling on the constitutional issue for the high court to review. The court vacated its earlier decision to take the case, sent the matter to the Court of Appeals of Georgia instead, and dismissed the appeal.

The Supreme Court of Georgia held that it lacked jurisdiction because the trial court's summary denial of the motion to set aside the default judgment did not distinctly or necessarily rule on the constitutional challenges to Georgia's garnishment default statute, a required step before the high court can review such a challenge.

The ruling means NBCUniversal's constitutional challenge moves to the Court of Appeals instead of being decided now, leaving the huge default judgment in place for the time being. It also flags, through a concurring opinion, that companies nationwide face similar risk of massive garnishment penalties from small paperwork mistakes unless lawmakers change the law.

Prior grant of application vacated, transferred to Court of Appeals; appeal dismissed

1. The court explained that it only has authority to hear a case based on a constitutional challenge if that challenge was raised in the trial court, the trial court clearly (or necessarily) ruled on it, and the ruling was appealed, a rule called the distinct ruling requirement.
2. The court noted that a trial court's short, unexplained order can sometimes satisfy this requirement if the only way to reach that result was by rejecting the constitutional argument, but that was not true here.
3. Applying that principle, the court found the trial judge could have denied NBCUniversal's motion simply because NBCUniversal failed to show a clear legal defect on the face of the record, a separate requirement under Georgia's rule for setting aside judgments (OCGA § 9-11-60(d)(3)), without ever reaching the constitutional arguments.
4. Because the record left it unclear whether the trial court actually decided the constitutional question, the Supreme Court of Georgia concluded it had no jurisdiction to keep the case and had to send it to the Court of Appeals of Georgia instead.

• garnishment default judgment
• excessive fines clause
• due process challenge
• court jurisdiction
• NBCUniversal